Congratulations on building a successful business from scratch! Your services and products are in demand and the profit margins are good. But what next? ‘Scale-up’ of course! For any Small or Medium Enterprise (SME), the growth of their business is measured by scaling up while maintaining its profit margins. Most small businesses are in a hurry to grow, but the key is to take baby steps to ensure that you have both the operational and financial means to get through the next stage of growth. So, how do you go about it? Listed below are a few pointers every small business should bear in mind before scaling up.
Change the pricing structure
It’s important to remember that while scaling up your business, your business model and the related pricing structure too should be scaled up. You will need to rework the pricing for your product or service without thinking like a small business anymore, but without hurting your existing customer base too. You don’t want to shock them with a sudden price hike. Ease them into it with discounts and offers, and let them know that you’re growing
Shift to cloud based systems
Small businesses tend to store their data on local servers. While scaling up, the amount of data shoots up. Shift to cloud-based systems to store them so that you don’t have to shell out a big amount for expensive servers to stay afloat. Apart from being convenient, a cloud-based system also gives the added benefit of being easy to access anytime wherever you are.
Implement a CRM System
Maintaining spreadsheets to track client and order information just won’t cut it when you need to scale up. You could lose valuable customer information and eventually lose track of all data. Switch to a CRM system so that the growing data doesn’t overwhelm you as you scale up your business. Remember that your customers and your relation with them are the basis of your business. Without all the valuable data you collated over the initial stages of your business, you would be at the losing end.
Hire the right staff
When businesses start out, it’s common to hire ‘generalists’ who are young, hard-working, entrepreneurial people rather than ‘specialists’ who come with years of experience in a specific field. As you scale up, it is important to hire these specialists who would complement the rest of your team; people who make up for what you or your workforce lacks. In other words, hire people who are better than you.
Make your presence felt
Whether it be social media or print media relevant to your industry, it’s about time you begin to make your presence felt. Share company updates, industry news or even your opinion on important matters. It also helps if everybody employed in your business has a public profile such as on LinkedIn. Not only does this give your business and the team some credibility, but it also tells customers who to reach out to other than the CEO.
All hail marketing!
This is the best time to experiment with different marketing strategies as you’re at the cusp of growing big. Focus on creating an awareness and educating people about your brand. Hire a great marketing team, see what strategy works for your business and then stick to it.
Get your finances in order
It is important for small businesses to dream big and be ambitious about its growth. But it’s equally important to ensure it has access to funds that can see it through this growth stage. Make sure that your cash flow and working capital are in order before embarking on scaling up. Bank loans may not always be the answer to these problems. Instead, explore alternate financing routes like peer-to-peer financing and invoice discounting. KredX, India’s first invoice discounting marketplace, is one such viable route for quick access to funds without any collateral to ensure a healthy cash flow.
The bottom line is that SME’s need to be prepared before embarking on the next stage of growth. Armed with these tips, you can now make informed decisions that are best to scale up your business. Good luck!